Google Leaves Norway

Google decides to close down its engineering team in Trondheim, Norway. Pandia takes a look at what this will mean for Google and Norway.

It is a bit strange, but tiny Norway does in fact have one of the leading search engine technology clusters in the world, focused on the university in Trondheim.

This was the research environment that gave birth to Fast Search and Transfer (recently acquired by Microsoft) and Fast’s AlltheWeb search engine (acquired by Overture, later Yahoo!).

Google established a development unit in Trondheim in 2006 in order to get access to this cluster of companies and knowledge institutions. This week the company decided to close down this unit, as well as units in Luleå, Sweden and Austin, Texas.

The consequences for Google

Jan Grønbech, the boss of Google Norway, argues that the goal is not to reduce the number of developers world wide, but to gather them in larger units.

This does actually make perfect sense. Google is a company that understand the need for inter-company collaboration. Having to many units may undermine the chances of creative “cross pollination” of this kind.

Google spokesmen denies that the move is caused by the financial crisis or that the Norwegian team has not been able to deliver the results the company wanted.

Director Nelson Mattos of Google EMEA (Europe, the Middle East and Africa) says to the Norwegian newspaper Aftenposten that the main reason is the danger of fragmentation, the company now having some 40 development centers around the world.

All of the 40 employees in Trondheim will be offered jobs elsewhere in Google.

Some of the younger, single, engineers may even take up that offer. The fact is, however, that most family oriented Norwegians tend to stay in the home country. It is a fair guess that many of them will be picked up by Yahoo!, which has its own unit in Trondheim and Microsoft’s Fast.

According to the Trondheim-based newspaper Adressavisen, Fast is already trying to get hold of some of this brainpower.

The consequences for the Norwegian search technology cluster

Within innovation policy circles there is an ongoing discussion on how foreign ownership and the establishment of foreign owned units like this own affects the innovative capability of local industrial clusters.

On the one hand they strengthen the cluster’s interaction with the mother company abroad. In this case, a significant number of Norwegian engineers have learned a lot about what goes on in Google and in California.

On the other hand units like this one seem only to a small degree to collaborate with other local companies in the cluster.

In this case it seems the Norwegian Google team has focused on the interaction with Silicon Valley, rather than Norwegian companies. The main exception have been the interaction with the Norwegian University of Science and Technology (NTNU), and human mobility, i.e. employees leaving Google for other companies.

The effects of Google abandoning Norway will therefore be twofold: The cluster will lose its direct connection to Mountain View, but the other companies (including Yahoo! and Microsoft) will gain some clever, Google-savvy, engineers. In other words: The Norwegian search engine cluster will survive.

One part of Google remains in Norway

Google’s sales office in Oslo will remain.

We doubt that this unit will be able to compensate for the lack of a Google development team in Trondheim, though.

Search technology intelligence gathering requires that you have engineers working on relevant problems. This means that Google will not be able to benefit from the development work taking place in Trondheim.

Originally Published On: 17 January 2009, Written by: Per and Susanne Koch.

Note: This is an archived version of original article.